Okay here is my 2 cents.
I think I read that you live in St. Louis which is 5 hrs north of me. We both live near the MS river and we get all 4 seasons (yours is probably a little colder in the winter).
Your garage looks well built and by the construction I would say in the late 50s or 60s? If the roof and rafters are still in good condition, then you have a monster sturdy construction. (Mine was built in 52 and if the roof had been taken care of, it would still be in excellent condition)
You will have a devil of a time taking down the wall and roof. They built things a lot better back then (seriously..the nails are probably over 3" long in a lot of places and they are a pain to remove carefully).
In my humble opinion, you have 3 good choices.
1. Insulate and run water like you would for a bathroom, install a lighting system, and create a wonderful large terrarium environment. Basically an indoor grow room.
2. Start with Option 1 and add professionally installed skylight windows and solar panels to offset your electrical costs. Add a tankless hot water heater.
3. Bulldoze the existing structure and install a professional (either DIY or installed) greenhouse.
I personally would not choose option 3 unless you are anchored to your house for life. Resale value of your property will be higher with the garage (even if converted). Option 1 and 2 could be converted back for resale or advertised as a functional workshop.
As for the electrical costs, as an example, I will give you ours from last season. We have a 9x11ish shadehouse which is covered with visqueen for the winter so it is not insulated at any real R value. Our utility bill averaged about $100 more for the months of December through March.
You can get T5s, T8s, and T12s at Home Depot and Lowes for pretty cheap and there are lots of heating options. If you are a good DIYer, you could do the conversion yourself.
Good luck and let us know what you decide to do. I would definitely get out of the basement. I personally hate a basement environment here in Memphis as it is damp and cold.